PART I – OF A II PART STORY – SELLING & BUYING TEARDOWNS

Your thinking about selling your house, but after more than a few years of living there, and normal wear and tear, it doesn’t look like the renovated homes listed online. To appeal to the widest range of buyers, you might want to make some updates, freshen up the yard, and stage a few of the rooms. But if you’ve seen properties in your neighborhood bought up by builders and demolished for new houses to be built…

Maybe selling your home as a teardown, would save you the effort of fixing it up, and help you sell faster…

Particularly in popular neighborhoods with limited undeveloped land, purchasing existing property for the sole purpose of building a new structure on the land is fairly common. In many cases, developers and building companies redevelop multiple properties in a neighborhood, knowing buyers will eat up newer homes.

Here’s 3 things to think about if you’re considering selling your house for redevelopment:

Define Your Teardown: While a home’s condition might seem to be the biggest indicator of whether it’s a good candidate for a teardown, location really plays the biggest role, as builders target parts of cities that have the highest demand from buyers. Teardowns aren’t just old, outdated homes, either. They can include luxury homes and relatively new structures. Builders also prefer a regular, rectangular lot on the middle of the block, as irregular lot shapes, small lot sizes, or corner locations can make redevelopment tricky.

Foregoing the Market: If you’re in a neighborhood where builders are particularly active, you may have already gotten a knock on the door or letter in mail asking if you’re interested in selling. When it’s the right kind of property, most builders are happy to make an offer on a home – often in cash – that makes the process simple, quick and free of commission paid to any real estate agents.

III. Consider a Little Work: In the right location, today’s seller’s market makes it so you could put your home on the market as-is and likely still receive interest. But if there’s a possibility you’re misdiagnosing your home as a desirable purchase for a teardown, you should think about preparing the home properly for the market, as minor updates and cleaning can go a long way. You should also have your property appraised to see how it would likely fare compared to similar homes in your neighborhood, or consult a real estate agent to see if they expect more builder versus homebuyer interest. No need to touch an outdated kitchen or bathroom since a renovating buyer will likely target those rooms for first projects, but a broken stair rail or damaged window should be fixed.

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